Forum Energy (LSE:FEP) presents us currently with a relatively simple looking daily chart configuration in recent months, with this also clearly being a symptom of the shares being relatively lightly traded. But despite or perhaps because of these factors it would appear that we have a straightforward technical setup, something which is said despite the way that such comments can often be the kiss of death for even the most promising of charting patterns.
Nevertheless, the confidence associated with the technical here stems from the way that for January to date we have been treated to a higher support level for the shares versus the December 20p floor, with the 20 day moving average at 24p doing the honours in this respect. The expectation now is that at least while above the 20 day line / September price channel floor at 24p on an end of day close basis the stock should head quite directly towards the 4 month price channel top at 45p / 200 day moving average. The timeframe on such a move is seen as being the next 1-2 months. Those who wish to see further evidence of recovery might wish to wait upon a weekly close through the 50 day moving average, fractionally above the latest 26p daily close. Only well below 20p is currently regarded as being outright bearish at this stage for Forum Energy on a charting basis.
